Executive Summary / Key Takeaways

• International Tower Hill Mines (THM) is a single-asset, development-stage gold company focused exclusively on its large-scale Livengood Gold Project in Alaska, holding significant proven and probable reserves and measured and indicated resources.
• The company recently bolstered its liquidity through a $3.9 million private placement in Q1 2025, providing sufficient cash for its approved $3.7 million 2025 work program focused on metallurgical studies, environmental baseline data, and community engagement.
• THM operates at a loss, reflecting its pre-production status, with Q1 2025 net loss increasing to $669k driven by higher exploration-related expenses and share-based compensation.
• A critical factor for THM is securing significant additional financing or a strategic alliance to fund the substantial capital expenditures required to advance Livengood beyond the current study phase towards potential development and construction.
• The investment thesis hinges on the potential to unlock value from the Livengood resource through successful technical studies, permitting progress, and ultimately, securing the necessary funding in a competitive gold market dominated by larger, producing peers.

The Alaskan Frontier: THM's Singular Focus on Livengood

International Tower Hill Mines Ltd. ($THM) is a mineral exploration company with a history dating back to 1978, incorporated in British Columbia, Canada. The company's journey has led it to a singular, high-stakes focus: the Livengood Gold Project in Alaska, USA. As a development-stage entity, THM's business model is centered entirely on acquiring, exploring, and evaluating mineral properties, with the strategic intent to either advance them towards production, seek joint ventures, or divest. Today, this strategy is embodied by its 100% ownership of the Livengood project, a vast land package approximately 70 miles northwest of Fairbanks.

The gold mining industry is characterized by significant capital requirements, long development timelines, and exposure to commodity price volatility and regulatory complexities. Within this landscape, THM operates as a niche player, concentrating its resources on a single, large-scale asset. This contrasts sharply with major gold producers like Newmont Corporation (NEM), Barrick Gold Corporation (GOLD), Kinross Gold Corporation (KGC), and AngloGold Ashanti plc (AU), which boast diversified global portfolios, established production streams, and significantly greater financial muscle. These larger competitors benefit from economies of scale, optimized supply chains, and advanced operational efficiencies, often achieving lower production costs per ounce compared to the potential costs a project like Livengood might face in its initial stages. While THM's focused approach allows for dedicated expertise in the specific Alaskan regulatory environment, potentially enabling faster regional project approvals, it also concentrates risk on a single asset and exposes the company to the financial and operational dominance of its larger, producing peers.

Unlocking the Resource: Studies, Expertise, and the Path Forward

The heart of THM's investment case lies within the Livengood Gold Project itself. The project hosts substantial gold mineralization, detailed in technical reports. As of December 31, 2024, Livengood reported proven and probable reserves of 430.1 million tonnes at an average grade of 0.65 g/tonne, totaling 9.0 million ounces of gold (based on a $1680/ounce gold price). Additionally, the project holds measured and indicated mineral resources, exclusive of reserves, of 274.51 million tonnes at an average grade of 0.52 g/tonne, containing 4.62 million ounces (based on a $1650/ounce gold price). This significant resource base positions Livengood as a potentially large, long-life gold mine.

Advancing a project of this scale requires rigorous technical evaluation and navigating complex environmental and social considerations. The 2025 work program, approved with a budget of $3.7 million, is designed to address key technical and permitting aspects. A significant focus is the metallurgical study of the massive stibnite antimony mineralization present at Livengood. This study is crucial as antimony can impact gold recovery processes, and understanding its metallurgical characteristics is vital for optimizing future processing methods and potentially identifying opportunities for byproduct recovery, which could enhance project economics. While the company's public disclosures do not detail proprietary, breakthrough mining technology in the traditional sense, the expertise within its team, drawn from backgrounds at major mining companies, is a key differentiator. This expertise is being leveraged to advance baseline environmental data collection, particularly concerning hydrology and waste rock geochemical characterization. This data is fundamental for supporting future permitting efforts, a critical and often time-consuming hurdle in project development. Continued community engagement is also a vital component, reflecting the importance of local support and relationships for successful project advancement in Alaska.

The strategic intent behind these studies and initiatives is clear: to de-risk the project, refine the technical understanding of the deposit, and prepare the groundwork necessary to move towards a production decision and secure the required permits. The metallurgical work on stibnite, for instance, directly addresses a potential processing challenge, aiming to improve recovery rates or reduce processing costs, thereby enhancing the project's economic viability. The environmental baseline studies are a prerequisite for the permitting process, which, if navigated efficiently, could accelerate the project timeline compared to competitors facing similar regulatory hurdles.

Financial Footing and the Funding Imperative

As a development-stage company with no revenue-generating operations, THM's financial performance is characterized by operating losses driven by exploration, evaluation, and administrative expenses. For the three months ended March 31, 2025, the company reported a net loss of $669,068, an increase from the $545,308 net loss incurred during the same period in 2024. This increase was primarily attributable to higher consulting fees ($61,747 in Q1 2025 vs. $56,700 in Q1 2024, excluding share-based costs), increased mineral property expenditures ($148,487 vs. $130,104), higher travel expenses ($7,799 vs. $2,114), and a notable increase in share-based payment charges ($63,581 vs. $13,810). These increases were partially offset by decreases in wages and benefits (excluding share-based costs, $189,558 vs. $196,208) and professional fees ($32,242 vs. $42,259). The shift in other income/expense from a gain of $67,601 in Q1 2024 to an expense of $6,813 in Q1 2025 was mainly due to foreign exchange fluctuations and lower interest income from short-term investments.

Liquidity is paramount for a company in THM's position. As of March 31, 2025, THM held cash and cash equivalents of $4.26 million, a significant increase from $992,487 at December 31, 2024. This improvement was largely the result of financing activities, specifically a non-brokered private placement completed on March 4, 2025, which raised approximately $3.9 million in gross proceeds through the issuance of 8.19 million common shares to existing major shareholders. This influx of cash boosted working capital to $4.19 million at March 31, 2025, compared to $959,703 at the end of 2024.

Management has stated its belief that the current cash position is sufficient to cover the anticipated $3.7 million 2025 work plan and general and administrative costs for at least the next 12 months from the filing date of May 8, 2025. However, the company explicitly acknowledges that significant additional financing will be required to continue operations and advance the Livengood project towards development and potential construction. This future funding need represents the most critical financial challenge. The company is exploring financing options, including the possibility of a strategic alliance, which could provide the substantial capital needed for future development, permitting, and construction costs. There is no assurance that such financing or alliance will be secured on acceptable terms, if at all.

Comparing THM's financial profile to its producing peers highlights the vast difference in their stages. While companies like Kinross, Newmont, and AngloGold Ashanti demonstrate positive gross, operating, and net profit margins (ranging from 17% to 35%+ net margins in 2024), positive operating and free cash flows, and significant revenues, THM has no revenue and operates at a loss, with negative margins across the board. THM's P/B ratio of 3.16 reflects market valuation based on its asset potential rather than current earnings or book value derived from operations, contrasting with the lower P/B ratios of established producers (e.g., KGC 1.66, NEM 1.42, AU 1.50 in 2024), which are valued based on existing profitability and asset base. This underscores the speculative nature of investing in a development-stage company like THM, where value realization is contingent on future project milestones and successful financing.

Minimum expenditures for mineral property leases and government fees are anticipated to be approximately $0.9 million annually in 2026 and 2027, contributing to total known contractual obligations of $5.52 million through 2030 and beyond, which must be funded through future financings.

Risks on the Horizon

The path from exploration to production is fraught with risks, and THM is subject to those inherent in the mining industry, particularly for development-stage companies. The most significant risk, as highlighted by the company, is the requirement for substantial additional financing. Failure to secure this funding on favorable terms could materially impact the company's ability to continue operations and advance the Livengood project, potentially casting uncertainty on its ability to continue as a going concern.

Permitting risk is also substantial. Significant delays in obtaining the necessary permits for ongoing work or future development could not only push back timelines but also necessitate additional funding specifically for prolonged permitting efforts. Unexpected results from the ongoing technical studies, such as unfavorable metallurgical findings or environmental challenges, could also negatively impact the project's economics and feasibility.

While the company's focused approach leverages regional expertise, it also means the company is highly exposed to conditions specific to Alaska and the Livengood area, including environmental regulations and local community relations. Furthermore, as a Canadian company with U.S. operations, THM believes it has been and expects to continue to be a passive foreign investment company (PFIC) for U.S. federal income tax purposes, which can have adverse tax consequences for U.S. shareholders.

In the broader competitive landscape, THM is vulnerable to shifts in gold prices, which directly impact the potential profitability and feasibility of the Livengood project. Larger competitors with lower operating costs and diversified assets are better positioned to weather periods of lower gold prices. Technological advancements by competitors in extraction or processing could also potentially make THM's planned methods less competitive if the company cannot adapt or incorporate similar efficiencies.

Conclusion

International Tower Hill Mines presents a compelling, albeit high-risk, investment opportunity centered on the potential of its large-scale Livengood Gold Project in Alaska. The company holds a significant gold resource, providing the fundamental basis for potential future value creation. The recent $3.9 million private placement has provided the necessary funding to execute the critical 2025 work program, which aims to address key technical and environmental aspects essential for advancing the project towards permitting and a potential development decision.

However, the path forward is heavily reliant on securing substantial additional financing or a strategic partnership to fund the significant capital expenditures required for mine construction. This funding challenge, coupled with inherent permitting and technical risks, represents the primary hurdle for THM. While the company's focused strategy and team expertise offer potential advantages in navigating the specific Alaskan context, it operates in a competitive environment dominated by larger, financially stronger producers. For investors, the thesis remains a bet on the successful de-risking and eventual development of Livengood, requiring careful consideration of the significant funding gap that must be bridged to unlock the project's considerable resource potential.